Detroit Bankruptcy plan of adjustment filed

**jt1** · February-21-14, 11:37 AM

Let the whining and lawsuits begin. Somehow everyone will insist they were cheated and expect the city to miraculously come up with money that does not exist.

**jt1** · February-21-14, 11:39 AM

Per Freep:

Under the plan, #Detroit says police and fire retirees will retain 90% of pensions while general retirees retain 70% of pensions.

Hopefully people will finally understand that entire pensions will not be lost [[even though that should have been plain as day since the city is only on the hook for the shortfall)

**bailey** · February-21-14, 11:46 AM

Originally Posted by jt1

Per Freep:

Under the plan, #Detroit says police and fire retirees will retain 90% of pensions while general retirees retain 70% of pensions.

Hopefully people will finally understand that entire pensions will not be lost [[even though that should have been plain as day since the city is only on the hook for the shortfall)

Yes, well that doesn't work as a headline on HuffPost or MSNBC or FauxNews.
Detroit to Pensioners: DROP DEAD! is much better for click generation and whipping up the outrage.

**Scottathew** · February-21-14, 11:47 AM

Originally Posted by jt1

Per Freep:

Under the plan, #Detroit says police and fire retirees will retain 90% of pensions while general retirees retain 70% of pensions.

Hopefully people will finally understand that entire pensions will not be lost [[even though that should have been plain as day since the city is only on the hook for the shortfall)

I hope so too. It really stinks that some folks will have pensions cut 34%, but it's better than the funds drying up and the checks bouncing. The pensions of the past are not sustainable.

There are many creditors taking a much bigger cut than what pensioners are taking, some will only get 20 cents on the dollar of what they're owed.

This is a case where Wall Street is getting the shaft, and I don't think I'll lose much sleep over tonight.

**corktownyuppie** · February-21-14, 12:45 PM

Originally Posted by 48307

I hope so too. It really stinks that some folks will have pensions cut 34%, but it's better than the funds drying up and the checks bouncing. The pensions of the past are not sustainable.

There are many creditors taking a much bigger cut than what pensioners are taking, some will only get 20 cents on the dollar of what they're owed.

This is a case where Wall Street is getting the shaft, and I don't think I'll lose much sleep over tonight.

There is a sweetener there for the pensioners as well. If they agree to the cuts instead of fighting in court, police and fire will only lose 4% of their pension. Gen. retirees will only lose 25%. In both cases they will reevaluate the pension funds in 10 years, and if there are better than expected returns, partial benefits can be restored at that time.

it's hard to say that I would be happy to hear this news, but given the context of the situation and desperate need to boost services in the city, I think this is a pretty reasonable offer. Especially for police and fire.

**jt1** · February-21-14, 01:01 PM

Originally Posted by corktownyuppie

there is a sweetener there for the pensioners as well. If they agree to the cuts instead of fighting in court, police and fire will only lose 4% of their pension. Gen. retirees will only lose 25%. In both cases they will reevaluate the pension funds in 10 years, and if there are better than expected returns, partial benefits can be restored at that time.

it's hard to say that I would be happy to hear this news, but given the context of the situation and desperate need to boost services in the city, I think this is a pretty reasonable offer. Especially for police and fire.

And general city employees still get SS so representations of their pension and the impact is only one piece of their income. I assume that the pension is less than SS. Is that's the acse, their total pension/SS income will only drop about 10% or less. Painful yes, putting people on the streets and forcing the elderly to eat dog food? No

**rb336** · February-21-14, 01:06 PM

It is better than most expected, I think, and while everyone has to take a hit it seems that this puts the people ahead of the banks

**coracle** · February-21-14, 01:23 PM

If I was an investor in Detroit General Bonds I'd be really pissed off with "also offers the holders of $374.6 million in unlimited tax general obligation bonds 20 percent of what they’re owed." [[from Detroit News) immediately after they've given $400 Million to Ilitch. Great timing!

If anybody has been really screwed it's the bondholders. I'm sure they won't be back ever.

**Wesley Mouch** · February-21-14, 01:41 PM

I do hope the pensions and city employees now understand that holding down your employer and extracting every last cent at every turn -- as well as avoiding modernization while hiding behind union-enforced work rules may not have been best strategy. Their union should have fought against 13th checks to pensioners, and absurd investments managed by fools as their nest egg.

This is not to dismiss all the other historical screwing of the taxpayers by Wall Street, the state, Kwame, and everyone else in existence. The flaws of others does not excuse your flaws.

**corktownyuppie** · February-21-14, 01:53 PM

My dad is receiving a GRS Pension. One of the questions he asked is why the shortfall in the GRS pension is so much worse than Police and Fire? I told him that the only people who can answer that are his union leaders and pension trustees. Sad to think that had they been better stewards of the money that the shortfall might only be 4% like their counterparts in the police and fire.

As far as bond investors being upset about the new hockey arena, that's not how it works. Even if that money were not exempt from bankruptcy proceedings, it couldn't all go to bond holders. It would be split among them, pensioners, and everyone else.

Im im not worried about future bond investors coming to the table. Detroit is going to have a wealthy co-signer who will be overseeing how the money is spent, a la NYC 1980-2000s

**GPCharles** · February-21-14, 02:14 PM

The hockey arena money doesn't currently exist and won't until those bonds are sold.

**Ray1936** · February-21-14, 02:50 PM

Originally Posted by corktownyuppie

In both cases they will reevaluate the pension funds in 10 years, and if there are better than expected returns, partial benefits can be restored at that time.

I'm 78 this fall. In 10 years I won't much give a shit about anything.

**BankruptcyGuy** · February-21-14, 02:57 PM

Originally Posted by corktownyuppie

My dad is receiving a GRS Pension. One of the questions he asked is why the shortfall in the GRS pension is so much worse than Police and Fire? I told him that the only people who can answer that are his union leaders and pension trustees.

My understanding is that the GRS issued more of the 13th checks and annuity fundings, and was less well funded as a result.

**GP For Life** · February-21-14, 03:42 PM

Originally Posted by jt1

And general city employees still get SS so representations of their pension and the impact is only one piece of their income. I assume that the pension is less than SS. Is that's the acse, their total pension/SS income will only drop about 10% or less. Painful yes, putting people on the streets and forcing the elderly to eat dog food? No

Some of the older pensioners might not have had the full protection of social security. I don't think it was until the 70s that municipal workers paid into SS.

Also, the pension boards for these pensions should be sued.

**professorscott** · February-21-14, 04:20 PM

Originally Posted by GP For Life

Also, the pension boards for these pensions should be sued.

Right, but if you win the lawsuit... the only asset the pension boards have is the pension funds... which would then have to be drawn from to pay the judgement.

**Ray1936** · February-21-14, 04:24 PM

Originally Posted by BankruptcyGuy

My understanding is that the GRS issued more of the 13th checks and annuity fundings, and was less well funded as a result.

That's true; the GRS issued at 13th check of sizable amounts every year. The P&F only issued one such check, about ten years ago, when the assets exceeded 100% of actuarial liabilities for that one year. While the P&F pension board had some questionable investments, they were far better than the General fund.

**coracle** · February-21-14, 04:42 PM

Originally Posted by GPCharles

The hockey arena money doesn't currently exist and won't until those bonds are sold.

If the city can afford to pay $400 Million to New Bond Holders just for Hockey they can afford to pay the current General Purpose Bond Holders that have already been screwed and in hock. Or they can afford to pay $400 Million into the Pension Funds. Screw hockey when you've got no money.

**ABetterDetroit** · February-21-14, 04:49 PM

Anyone else excited about the huge increases of capital for the city to work with to better the lives of the 700,000 odd currant citizens of Detroit if this deal was to be accepted or is It just me?

**jt1** · February-21-14, 04:51 PM

Originally Posted by ABetterDetroit

Anyone else excited about the huge increases of capital for the city to work with to better the lives of the 700,000 odd currant citizens of Detroit if this deal was to be accepted or is It just me?

I am, however it seems that retirees would rather have every person in the city shot than give up one penny.

**renf** · February-21-14, 04:55 PM

Is the Bankruptcy Plan of Adjustment on line somewhere so that it can
be read or downloaded for reading?

**rb336** · February-21-14, 05:08 PM

Originally Posted by coracle

If I was an investor in Detroit General Bonds I'd be really pissed off with "also offers the holders of $374.6 million in unlimited tax general obligation bonds 20 percent of what they’re owed." [[from Detroit News) immediately after they've given $400 Million to Ilitch. Great timing!

If anybody has been really screwed it's the bondholders. I'm sure they won't be back ever.

Please read any of the multitude of posts about how tax increment financing exists

**Khorasaurus** · February-21-14, 05:38 PM

Originally Posted by rb336

Please read any of the multitude of posts about how tax increment financing exists

And how the DDA and the City are completely separate entities.

**BankruptcyGuy** · February-21-14, 05:47 PM

Originally Posted by renf

Is the Bankruptcy Plan of Adjustment on line somewhere so that it can
be read or downloaded for reading?

It is available on the Detroit News website. Pour yourself a cup of coffee; it is 440 pages.

**Honky Tonk** · February-21-14, 06:11 PM

This is going to be a long thread.....

**Det_ard** · February-21-14, 07:48 PM

Which union are/were the general employees in? Surely their union brothers and sisters won't let them down. They'll sacrifice a little from their checks or from the union's funds to make their brothers and sisters whole.

Won't they? Solidarity, right?

Or is it more like, "Tough shit, I got mine, screw you, brother."